Associated entities and business sponsorship on the subclass 457 visa

Posted on May 27, 2016 by Benson Shi

In order to nominate a foreign national for employment in Australia, an employer must either negotiate a labour agreement or apply for approval as a standard business sponsor. The latter is the more common of the two paths.

To become a sponsor, a business must be lawfully operating and there must be no relevant adverse information against the business. Businesses in Australia must also demonstrate commitment to employing local labour, non-discriminatory recruitment practices and meet training benchmarks.  Sponsorship is usually valid for five years, although a business may lodge a variation application to extend its sponsorship at any time during this period. Businesses who have been trading for less than 12 months are limited to a sponsorship approval period of 18 months.

Temporary residence transition stream

Under the temporary residence transition stream of the Employer Nomination Scheme (ENS), an applicant who has held a subclass 457 visa for at least two years and intends to continue their employment with the same sponsor may apply for permanent residence. Two years of employment with an associated entity of the sponsor will also count for the purpose of the ENS application process. In this event, the sponsor and employer would be viewed as separate, but related entities. An associated entity is defined in section 50AAA of the Corporations Act 2001 (Cth) as a related body corporate to the principal of the business, where one has significant influence over the other or a qualifying investment, and the operations, resources or affairs of one entity or interest from the investment is material to the other entity.

Change of ABN

Approval as a business sponsor is attached to the Australian Business Number (ABN). If for any reason a business adopts a new ABN, the business must lodge a variation application regardless of whether it retains the same management.

A business which has sponsored an employee for at least two years on a subclass 457 and changes its ABN during the course of this period will need to lodge a new sponsorship and nomination application before the employee will be eligible for an ENS visa via the temporary residence transition stream. The two years of employment under the old ABN will count for the purpose of the ENS application, as the Department will view the new ABN as an associated entity of the former ABN.

If you should find yourself in this position and your employer has acquired a new ABN, contact the team at Immigration Solutions. With more than 23 years of experience as an accredited specialist in immigration law, our principal lawyer, Anne O’Donoghue, will be able to advise you of your visa options and guide you through the application process.

Disclaimer: The information provided is not legal advice and is not intended to serve as legal advice. Immigration Solutions Lawyers do not accept any liability for any damages suffered by persons who rely on the general information provided on this website. Liability limited by a scheme approved under Professional Standards Legislation.